Justice Department Shifts Scrutiny to Apple’s Music Store

The Department of Justice is reportedly looking into Apple’s bullying ways in the digital music market, where its iTunes music store accounts for 70 percent of digital music sales and 28 percent of all music sales in the United States.

At issue: Apple’s objection to Amazon’s sale of certain albums exclusively, for one day and sometimes in advance of their official release dates, as part of a Daily Deal program launched nearly two years ago.

Since then, Amazon’s program apparently became too successful for Apple’s liking. Jobs and company began complaining to music executives about Amazon’s alleged special treatment around March of this year, according to Billboard.

For Apple, the situation came to a head when Amazon began asking labels participating in the program for free promotion on MySpace and other sites. “When that happened,” an anonymous music executive told Billboard, “iTunes said, ‘Enough of that shit.'”

Now, Apple’s pressure on labels to withdraw or amend Amazon’s special-deals program appears to have drawn the attention of the Justice Department.

The New York Times reports that Justice Department staffers are asking around at labels and digital music companies to find out whether Apple has unfairly exerted its dominance of digital music to try to crush Amazon’s bargain music promotions. The Justice Department was also reportedly looking into Apple’s stance towards developers for its iPhone OS platform, and has likewise rattled its saber in Google’s direction.

We can understand why Apple would object to Amazon making deals to sell music on the cheap in advance of its official release date, especially because the same labels typically call up the lawyers when people circulate pre-release music, and because the same labels have been largely responsible for the high price of the digital music.

However, we can also understand why the Justice Department would raise an eyebrow. Apple could be overstepping its bounds in the eyes of antitrust authorities by pressuring the labels to end their participation in Amazon’s bargain music program, which currently beats iTunes in pricing on several currently promoted albums, apparently with the labels’ help.

This sort of thing sometimes leads to an investigation — and other times it’s just a way to get the press to send a message to a company that it had better start minding its p’s and q’s unless it wants a stern talking to. For instance, after antitrust authorities said they were concerned about Apple’s blockage of the Google Voice app, Apple relentedHTML5 put Google Voice on the iPhone anyway, accessible through a Safari bookmark that looks like a home screen app.